Semiconductor giant TSMC is expected to stop supplying chips made with
  7 nm or smaller processes to customers in China that are developing AI
  processors or GPUs. The move is reportedly to ensure it remains
  compliant with US export restrictions.

  The Taiwan-based megacorp, the largest semiconductor contract
  manufacturer worldwide, is said to have notified AI/GPU chip companies
  in China that it will halt shipments to them of 7 nm and more advanced
  silicon, starting from November 11.

  This follows events last month when TSMC reportedly tipped off US
  officials that a Chinese customer appeared to be [1]trying to
  circumvent export controls against China-based tech firm Huawei by
  placing orders for a chip resembling Huawei's Ascend 910B GPU.

  It was later claimed that the biz halted all shipments to the customer
  in question, [2]alleged to be chip designer Sophgo, although the latter
  denied the claims.

  Now TSMC is suspending production of advanced silicon for Chinese
  clients developing products aimed at high-performance computing, GPUs,
  and AI-related applications, as reported by [3]Nikkei Asia and
  Taiwan-based industry watcher TrendForce, which cites Chinese-language
  media outlet [4]ijiwei.

  This will not affect Chinese customers wanting 7 nm chips from TSMC for
  other applications such as mobile and communications, according to
  Nikkei, which said the overall impact on the chipmaker's revenue is
  likely to be minimal.

  TrendForce further cites another China-based source who claims the move
  was at the behest of the US Department of Commerce, which informed TSMC
  that any such shipments should not proceed unless approved and licensed
  by its BIS (Bureau of Industry and Security). We asked the agency for
  confirmation.
    * [5]TSMC prioritizing high-NA EUV scanners for R&D
    * [6]OpenAI reportedly asks Broadcom for help with custom inferencing
      silicon
    * [7]TSMC reportedly cuts off RISC-V chip designer linked to Huawei
      accelerators
    * [8]TSMC blows whistle on potential sanctions-busting shenanigans
      from Huawei

  Any moves by the silicon supremo is likely to be out of caution to
  pre-empt accusations from Washington that it isn't doing enough to
  prevent advanced technology from getting into the hands of Chinese
  entities that have been sanctioned.

  As TrendForce notes, it "highlights the foundry giant's delicate
  position in the global semiconductor supply chain amid the heating chip
  war between the world's two superpowers."

  For example, TSMC was awarded billions under the US CHIPS and Science
  Act toward building fabrication plants in the state of Arizona, an
  arrangement that [9]may be reviewed under the Trump administration, it
  was suggested earlier this week.

  TSMC neither confirms nor denies the reports. A spokesperson told us:
  "TSMC does not comment on market rumor ... TSMC is a law-abiding
  company and we are committed to complying with all applicable rules and
  regulations, including applicable export controls."

  The semiconductor maker recently reported [10]a strong third quarter
  2024 with revenue of $23.50 billion, an increase of 36 percent over the
  same period last year, with chip output from its most advanced process
  nodes – 3 nm and 5 nm – now accounting for more than half of that. ®

References

  1. https://www.theregister.com/2024/10/22/tsmc_huawei_sanctions_report/
  2. https://www.theregister.com/2024/10/28/tsmc_sophgo_huawei/
  3. https://asia.nikkei.com/Business/Technology/TSMC-to-suspend-production-for-some-Chinese-AI-chip-customers
  4. https://jiweipreview.laoyaoba.com/n/922301
  5. https://www.theregister.com/2024/11/07/tsmc_highna_euv/
  6. https://www.theregister.com/2024/10/30/openai_broadcom_tsmc_custom_silicon/
  7. https://www.theregister.com/2024/10/28/tsmc_sophgo_huawei/
  8. https://www.theregister.com/2024/10/22/tsmc_huawei_sanctions_report/
  9. https://www.theregister.com/2024/11/04/chips_act_repeal/
 10. https://www.theregister.com/2024/10/17/tsmc_q3_2024/